Iran is ready to expand trade with Kurdistan Region: Consul-General

ERBIL, Kurdistan Region — Iran is ready to start technical negotiations with the Kurdistan Region over the opening of two important free trade zones following similar agreements made with Baghdad, the Iranian Consul-General in Sulaimani told Rudaw on Saturday.

“We are ready and we have completed the preliminary work at both border crossings, namely Parvizkhan and Bashmakh, to establish these free zones,” Mehdi Shushtari told Rudaw’s Samya Hassan on Saturday evening.

“The legal procedure has finished, it has been approved and even the budgets have been allocated and we hope that the work begins in the near future,” he added.

Parvizkhan and Bashmakh are two important border crossings linking Iran’s Kermanshah and Kurdistan provinces to the Kurdistan Region of Iraq. While the onset of the novel coronavirus brought trade between Iran and Iraq to standstill, trade largely continued between Iran and the Kurdistan Region through these border crossings. The impact of the coronavirus pandemic has meant that trade level between Iran and Iraq will stand at around nine billion dollars this year - four billion less than last year.

Kermanshah alone has 371 km of land bordering the Kurdistan Region and Iraq, with six border crossings and border markets.

“Last year, in total three billion dollars was the level of exports to Iraq and Syria...Kermanshah is the supplier of foreign currency to the country in relation to non-petroleum exports,” Hedayat Hatami, a top economic official in Kermanshah was quoted by IRNA as saying on July 23.

Shushtari’s comments come at a time that US sanctions have crippled Iran’s ability to export its petroleum, a main source of the country’s foreign currency.

Since the overthrow of the previous regime in 2003, Iraq and the Kurdistan Region have become two important destinations for Iranian goods, bringing in much needed foreign currency.

Iran’s trade volume with Iraq and the Kurdistan Region has stood at around 13 billion dollars in recent years, just over half of which is through around half a dozen land border crossings with areas under the control of the Kurdistan Regional Government (KRG). Iranian officials, including President Hassan Rouhani, have repeatedly said that they want to increase the volume to 20 billion dollars in coming years.

Tehran has paid particular attention to expanding its non-petroleum trade with neighboring countries since Washington withdrew from the Iran nuclear deal in May 2018 and reimposed sanctions on the country, crippling the Iranian economy. 

Shushtari spoke about several issues in a 20 minute interview at Rudaw's Sulaimani studio, including the quality of goods entering Iraqi and Kurdish markets as well as the shelling of border areas, which has burned hundreds, if not thousands, of acres of forests.

“As the Islamic Republic of Iran, the stability and the security of Iraq and the Region is important to us, we see the stability of the Region and Iraq as part of our own security and naturally in order to establish security in the border area, we do our utmost,” Shushtari said.

The shelling of the border area, he added, was “in response to the terrorist actions of some known groups which unfortunately use the Region’s soil to attack our border areas, towns and villages and sometimes even our border forces.”

“In particular in the past several months, several terrorist actions have been launched from KRG soil against the Islamic Republic and of course this is a red line for any country and any state,” he said.

Kurdish armed groups based in the Kurdistan Region say that Iranian authorities systematically violate the rights of its Kurdish minority, which is evident, they say, in its widespread imprisonment and execution of Kurdish political prisoners. The Kurdish areas are some of the poorest and under developed areas of the country.

Hundreds of kolbars, or semi-legal porters, are killed by Iranian security forces each year transporting goods across the Iran-Kurdistan Region border, with many pushed into the trade by crippling poverty.